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I was starting Naruto and noticed the Hokage using a crystal ball to watch Naruto.

1) How does the crystal ball work?

2) What's its range?

3) What are its limitations?

4) Does any of the other characters in future episodes use it (tag spoilers)?

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I was searching on the third hokage crystal ball. I happen to come across this link here on a wiki

A technique that uses a crystal ball to track a particular individual anywhere they are. There are a few restrictions about the person that is subjected to pursuit. The user must know that person's chakra pattern. If someone can be targeted for pursuit, they may be very far away, the crystal ball will be able to confirm their position. As this technique is infallible for intelligence purposes, the Third Hokage used it to maintain public order in the village.

http://naruto.wikia.com/wiki/Telescope_Technique

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    it's best to quote the relevant content of the link you post because if the link to the site was to go down your answer will be invalidated. "I think copying and pasting the content of that link as though i invented them, is not right." you can use > to indicate a quote and to also include the link indicating the quote came from that link. – Memor-X Jul 18 '16 at 11:46
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    The footer of the page says: Content is available under CC-BY-SA. which is the same license SE uses. So it is perfectly fine to copy & paste contents from that page as far as you link to it. The whole purpose of wiki pages is to provide free knowledge, and allow for redistribution and modification of the content. – Bakuriu Jul 18 '16 at 13:24
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Much like many of the original concepts of the series (See, the Kawarimi no Jutsu), most of the "magical"-like aspects of the world has been scrapped, probably in hopes of the fans forgetting about them because they made no sense and had no explanation.

The Third Hokage's crystal ball is like that.

Not much had been explicitly explained, but it could be argued that the crystal ball is a display for surveillance cameras or other similar sensors, pre-set all over the village. This is only a wild theory though, it has no basis in the series whatsoever.

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